Thousand Oaks is losing another longtime local retailer.
Less than two months after Sears announced it was closing at the Janss mall, word came last week that Orchard Supply Hardware would meet the same fate.
The Avenida de Los Arboles store, which opened in 1996, will join 99 other OSH locations in California, Oregon and Florida that are going out of business following a decision by the chain’s parent company, Lowe’s Companies Inc.
In 2013, the home-retail giant—which is in the process of building a 94,000-square-foot store off Wendy Drive in Newbury Park—purchased all OSH stores nationwide for $205 million.
Now its new CEO, Marvin Ellison, formerly of JC Penney, is making big changes. The decision to shutter all Orchard Supply Hardware stores comes after Lowe’s failed to keep pace with its biggest rival, Home Depot, during the first two quarters of the year, according to reports.
Lowe’s was still profitable, its most recent earnings report shows, netting $1.5 billion during the second quarter of 2018, and is on pace to outperform its 2017 numbers.
In all, 4,300 OSH employees will lose their jobs as a result of the move, including 57 at the Thousand Oaks location.
While the fate of OSH employees remains unclear, Ellison did say in a press statement that they will have priority status in applying for jobs at Lowe’s, which may bode well for those in T.O., as Lowe’s is expected to open its store next to the freeway in Newbury Park in early 2019.
In a letter notifying the City of Thousand Oaks of the impending layoffs, Lowe’s HR representative Angela Kirkby cites market conditions as the reason for the company’s decision to close the stores.
“This closure will affect the entire facility,” Kirkby writes. “As a result of the closing, the employment of all employees at that facility will be terminated.”
The Lowe’s rep says the closing will be effective at the “conclusion of business needs” but not before Oct. 20.
The property that currently houses Orchard Supply Hardware sold just three years ago for $16.75 million. At the time, the seller’s agent, Colliers International, touted the tenant’s staying power and prime location.
Sandwiched between two grocery-anchored shopping centers near the 23 Freeway, the building was acquired by St. Paul, Minn.-based Oppidan Investment Company, a national property development firm.
“Among the main reasons we were able to achieve this record price level was that this is a single-tenant (OSH) store situated in a supply-constrained market with virtually little to no competition,” Colliers executive vice president Christopher Maling said at the time. “Barriers to market entry are many, but most importantly for this particular property, the barriers include the fact that the nearest hardware and home improvement center is 5 miles distant.”
In the end, it wasn’t enough to save OSH.
Haider Alawami, the city’s economic development officer, said he suspected the new Lowe’s could lead to the hardware store’s demise.
“They’re not going to compete with each other,” he said.
Though the city has received no assurances, Alawami said, he hopes the laid off Orchard Supply Hardware employees will be offered jobs at the future Lowe’s. In the meantime, the employees will be referred to the county’s employment office for help in their job search.
Asked about the prospects of replacing OSH as a tenant, Alawami said they’re better than average given the building’s location in a neighborhood and in between two thriving shopping centers, including one that was recently revamped.
He said Ace Hardware, which used to have a location in T.O., is expanding but the 43,000-square-foot building and 5-acre parcel at 1934 E. Avenida de Los Arboles may be too large for them.
On a positive note, the economic development officer said two restaurants are moving into the shopping center in the coming months.